As previously mentioned, the mattress industry is in an absolute frenzy this year. The online-only mattress companies are soaring in popularity both with consumers and investors. Though I'm familiar with some of the larger startups and how they operate, I wanted to learn more about the smaller bootstrapped companies just entering the market. That lead me to interview Lori Zack of 4Sleep, a very new mattress company looking to compete with both traditional mattress companies and the very popular mattress startups.
The mattress startup landscape is very busy these days. How can a new company stand out from the noise?
It starts with the product. The product has to address the customer's needs, it has to be designed to solve their sleep issues. It has to be top notch quality and ideally it should have some feature or features that make it distinctive and desirable. Our approach was based on a strategic partnership with one of the best, most experienced foam manufacturers out there. That definitely has taken us from a concept to the reality of a top quality, differentiated product at a competitive price for consumers relatively quickly. You can't compete on price alone and succeed. Finding a niche is helpful as is addressing a consumer need that isn't being addressed adequately by the competition.
But gaining brand identity and affinity as a new entrant into the marketplace has never been so difficult, particularly as a start-up with extremely limited marketing funds. We simply cannot spend to get eyeballs and market share at the levels of many of our competitors - at least not at this point. Frankly, though, for where we are right now and for our mission, we are not convinced that buying ad words, for example, actually helps consumers find and buy the right mattress specific for their needs - which is where we want to start.
We know that one of the biggest issues for consumers - something that I personally experienced in solving my own sleep challenge - is that there is not enough accessible, reliable information about mattresses and sleep health to allow consumers to make good choices for their own preferences. We are focused on grass roots, organic and educational communications to provide that much needed information so consumers can feel comfortable about their mattress buying decisions - particularly in a direct, online purchase. [You will see much more from us in this regard in coming weeks in the form of short videos on everything from sleep's impact on health to safety of foam to firmness vs softness and answers to many other questions facing mattress buyers.]
Do you like being the underdog? What character traits do you think it takes from an entrepreneur to really compete in this market?
We have been entrepreneurs most of our careers - the last 20 years - long before running a start-up was cool. It's been our experience that starting a new business almost always puts you in the position of being the underdog - but we don't have a chip on our shoulders about that because we are choosing to create something different, to solve a need, to respond to a desire. And we always go back to that. There are actually lots of advantages to being the underdog (no one is watching your failures so you can take tons of risks to get it right; you can do surprising things at unexpected times, etc.) - and if you can turn those advantages to your favor, well, that's what the successful underdogs do - and then they are no longer underdogs! We see our competitors like Casper having great success at that.
We think we have exactly what it takes to not only compete, but succeed in our competitive landscape. We are lean and mean -a super small team - so we have very little overhead expense. We are laser-focused on product quality and excellent customer service. We are constantly adapting - to the market, to consumer feedback, to all the ways of communicating with consumers. We move quickly. We always remember who we are and why we are doing this. And we laugh a lot. As husband and wife in the roles of President and COO (meaning, we do anything and everything to advance our business!), we have to have a great sense of humor, an unwavering commitment to our vision and to each other, and a lot of patience and audacious determination in the face of uncertainty.
What is your background? What made you finally jump on the mattress startup idea and launch 4Sleep?
I am a notoriously bad sleeper - always have been. And I have known for a long time what all the health experts are more recently confirming - that quality sleep affects health and well-being more than almost any other single factor. And I have tried everything. My husband Dave, who, early in his career was working in the foam business, finally talked me into trying a foam mattress - - and I never went back. I just felt certain that there was a ton of room for improvement in all of the foam mattresses I tried.
So while running a different business, our first start- up (ad specialties), Dave and I started talking to experts and ultimately met our strategic partner. Our partner became as convinced as we were that there was a better foam mattress to be developed - so we worked together to try different specifications and product features and came up with several really good mattresses which have been solid sellers for us. But it wasn't until we combined four layers of specialty foams together, each of which addresses key elements of a good night's sleep, that were we confident that we had THE mattress - 4Sleep. I have never slept better or felt more energized all day long after sleeping on our mattress. Literally, life changing for me. I had to believe there were others out there like me - and our customers are confirming this!
What does your company look like in these early days? How are you funded, and how are you planning to grow?
We have a very small team, a family, really - a handful of very dedicated, knowledgeable and passionate folks who are committed to our mission. All of us serve multiple roles, and many of us speak daily with customers, to make sure they are happy with their mattress and to hear about their sleep experiences so we can see what can be improved. (I could tell you so many stories from real people with whom I have personally spoken and heard their issues and sent mattresses to help respond. It is an unbelievably satisfying part of what we do.)
With the game-changing contributions of our strategic partner, we have funded our business so far with no outside investment. We are extremely discriminating about what we do spend and we know where we need to be in our business plan to take on incremental employees and increase spending on marketing. We expect a relatively slow growth curve but we're not in this to hit it rich quick and exit. We have a long term business strategy to build a best-in-class direct sales business that can scale easily as the business grows with a singular focus on delivering a great night's sleep.
What companies do you admire that have competed as an underdog in a hot industry, mattress or otherwise?
While it may not be in a "hot" industry, we admire Ben & Jerry's as once being the underdog in an almost commoditized space. Certainly, there was good ice cream before Ben & Jerry's. But they took good ice cream to a whole new level -- and they built their business and brand identity slowly on a message of quality ingredients making ice cream an "experience" for the first time.
Apple of course. No need to say more there. (It's even hard to remember that Apple was ever an underdog!)
The Life Is Good guys, there is so much about their story that I respect and admire.
Tell me about the mattress -- how did you approach the design, and what makes it special in your eyes?
While Dave had specific experience in the foam industry, I did not. What I had experience in (and Dave, through those horrible restless nights) was not sleeping well. So we actually looked for what would make me sleep better. Temperature moderation, responsiveness but with motion control, resiliency (a sturdy base), an edge that wouldn't completely collapse when I rolled over. And a price that we could afford. With our manufacturing partner's expertise, we focused on those features and tested, tested, tested. We're still testing.
While this is a great product in an industry with great potential opportunity, when you boil it down, it's a personal journey that we are sharing and we feel strongly that our mattress can be a solution for others. It may not be for everyone, and we are not here to serve everyone's needs, but there have to be others like me out there.
Who is your target customer? What are you doing with your product and marketing to reach them?
Our consumer is interested in a sleeping well on a quality, well-priced mattress that they can purchase directly. The 4Sleep customer understands how important a restful night is to an energetic day. Our product was specifically designed to respond to that and we want to build a brand that speaks to a satisfying, healthy, active lifestyle. We want our consumers to know that is what 4Sleep stands for and will deliver.
Currently, we are reaching consumers with social media, PR outreach, word of mouth programs, our online video programming, and some paid online advertising. We are facilitating a wide range of customer and expert trials, and of course, all purchases are built-in trials with our 100% no questions asked 100 day return policy. If we had more funding, of course, we would want to get our brand and message out there faster, more broadly, and in mainstream channels. And hopefully we will be doing that soon.
What will define success for 4Sleep over the next year?
Customers who love our product - who sleep better and live better, first and foremost. And who spread the word. This is happening, but we need more of them. So a focus on brand identity is of chief concern. And enough sales to keep us going until brand identity progresses.